Who says tax cuts don’t work?
The first quarter of 2018 will end Saturday. America’s small businesses already have much to be grateful for this year.
More Americans — especially job creators — began the new year feeling a greater sense of economic optimism knowing their tax burden was reduced by the Republican tax cuts passed in December.
But Democrats' negative messaging has led many to believe that tax cuts will only benefit the wealthiest 1 percent of Americans. It's patently false. Tax cuts have benefited almost all Virginian residents.
Here is the proof:
In Virginia alone, small businesses account for more than 99 percent of all businesses, employing over 1.5 million Virginians. Many of the roughly 706,000 small businesses in Virginia are starting to reap the benefits of tax cuts. And my small business, Deckscapes of Virginia — a deck construction firm based in Manassas — is just one of them.
Before the tax cuts, many small businesses were taxed at the top federal marginal rate, which once state and local taxes are added in, can be nearly 50 percent. Today, that federal rate has been reduced to 37 percent, thanks to the federal tax cuts. And this additional tax savings is being used by job creators to reinvest in their businesses. I certainly am!
Since the passage of tax cuts last December, my business has been fortunate enough to hire an additional 10 employees throughout the year. And I know that I’m not the only job creator investing back in my business. Nexus Services in Verona announced a 5 percent pay raise for all employees, in addition to hiring 200 new employees in 2018. And Huntington Ingalls Industries in Newport News distributed $500 bonuses to all hourly and salaried employees, except those who participate in an incentive plan.
The rise in economic optimism has also been felt by consumers. For my business, I’ve seen a massive increase in new clients since the passage of the tax cuts — a level I haven’t seen in more than 12 years. Even my current clients are excited about the renewed sense of confidence in the economy. Many of them are seeking out larger, more expensive deck projects that they wouldn’t have previously if it wasn’t for the lower tax burden. It's further proof that Virginians are using their pay raises and bonuses to reinvest in Main Street, just as Republicans promised.
Even outside Virginia, the economy is continuing to expand. February’s U.S. job report showed more than 313,000 new jobs added to the economy. The unemployment rate, 4.1 percent since October, is the lowest it’s been in nearly 17 years.
We owe our thanks to the tax cuts. From bonuses and increased pay to thousands of additional jobs created, tax cuts have accomplished exactly what they were set out to do: Grow the economy.
Tax cuts benefit Americans of all stripes, and we are just seeing the tip of the iceberg.
Gary Desilets is the owner of Deckscapes of Virginia in Catharpin.